Professional MBA MAN 6244 Organizational Behavior Session 4

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Professional MBA MAN 6244 Organizational
BehaviorSession 4

• Class 2009, Session II
• Orlando Metro West
• Spring 2008
• Dr. B. Wayne Rockmore, APS

This PowerPoint presentation is intended to be a
supplement to your class notes, not a replacement
for them. It provides a general outline of
topics and their relationship to each other.
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On Tap for Tonight

• Session 4
• Organizational Change
• Diversity, Organizational and Global Cultural
  Issues
• Organizational Design (Structure)
• Organizational Design Exercise

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BARRIERS OF ORGANIZATIONAL CHANGE

• BRAIN BARRIER 1
• Fail to see the need for change
• BRAIN BARRIER 2
• Fail to move act
• Even though we see the need to change
• BRAIN BARRIER 3
• Fail to finish the change process

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Barriers of Change GAP Analysis

• ? GAP Analysis
• Where are we now? We need to see the need for
  change new map
• Where do we want to get to? Path the action
  -we need to take to pursue the new map
• How can we get there? The behaviors or actions
  necessary to learn how to do the new map well and
  finish the change process

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TransformationOrganizational or People Issue

• It is more about transforming peoples attitudes
  and behaviors . . .
• Than strategy, structures and systems.
• They are important but are not transformation in
  and of themselves
• Transform from Seeing is Believing to Believing
  is Seeing create a sense of Trust is Faith
  (avoid Fads which destroy trust)

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Organizational Change and Individuals

• Assessing the Personal Value of Change
• Personal (Me) v. Organizational (Us) Motivation
  for Change
• Equity Theory and the Motivation of Individual
  Change
• Personal Return on Investment (effort)
• Communication of Expectations Change Goals
• Establish Performance Criteria
• Communicate Performance Progress
• Explain Performance Targets and Progress
  Accomplishments (Good, Bad, Ugly)
• Personalize Individual Performance Progress and
  Plans for achievement

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Getting Ahead of theChange Curve

• Anticipatory Change (Visionary)
• Identify signs (trends) indicating the eventual
  need for change
• Most difficult to initiate and least expense
  (long-term)
• Greatest Potential Benefits/Lowest Cost
• Reactive Change
• Signs of Change are apparent but Old Maps still
  appear valid (Success makes it difficult to get
  others to see the need for Change New Map)
• Crisis Change
• It is undeniable, immediate and Survival depends
  upon it!
• Easiest to initiate BUT most expensive

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The Failure to SEE!Resistance!

• Resistance to Change?
• Habit (behaviorally programmed)
• Self-Interest
• Fear
• Organizational Inertia (Top Managements ability
  to act, communicate and understand)
• Resources
• Culture

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Smart People DontTry New Tricks

• Why should we?
• We may lack the direction
• We have know the direction, but still do not
  act
• Why would a clear vision of the new strategic map
  immobilize people?
• FEAR!!!
• Doing Well (old map) v. Avoid doing poorly (new
  map)
• Embarrassment, Power Status Shift, New
  Distinctive skills (performance criteria), Reward
  Structure
• Create a Path for Success!

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Indicators ofResistance to Change

• Active being critical, finding fault, Appealing
  to Fear, Sabotaging/Undermining, Intimidating,
  Manipulating, Distorting, Blocking, Rumors
• Passive malicious compliance (agreeing but
  intentionally not acting), procrastination,
  willfully withholding information, assistance or
  support

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Why People Resist Change

• Dislike of Change, Discomfort (with the
  Uncertainty of Change, ethics or personal life
  changes)
• Attachment to the Established Culture (Comfort
  with known operations/expectations)
• Negative Effect of Personal G,N,D, I or Es
  (breach of a Psychological Contract)
• Failure to See the Need for Change or Understand
  What is Expected
• Disagreement with the Implementation Process
  (belief that the proposed change is
  inappropriate, wrong timing or change is
  excessive)
• Experience with the Effects of Previous Change

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Managers asChange Resistors

• ?Champions of Change are and must be at every
  level of the organization
• ?Managers may have the most to lose due to change
  positive change factors may be threatened
• Security
• Money
• Authority, Responsibility, Status/Prestige
• Better Working Conditions
• Increased Self-Satisfaction
• Personal Contacts Networking
• Less Time Effort

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The Defining Characteristics of a Companys
Culture

• Its core values, beliefs, and business principles
  
• Patterns of how we do things around hereits
  style of operating and ingrained behaviors of
  company personnel
• Oft-told stories illustrating companys values
• Its approach to people management
• Ethical standards
• Internal politics
• Traditions

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What to Look for inIdentifying Corporate Culture

• A Companys culture is manifested in . . .
• Values, beliefs, and business principlesmanagemen
  t preaches and practices
• Official policies and procedures
• Its revered traditions and oft-repeated stories
• Attitudes and behaviors of employees
• Peer pressures that exist to display core values
• Its politics
• Approaches to people management and problem
  solving
• Its relationships with external stakeholders
• Chemistry and personality permeating work
  environment

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How Is a CompanysCulture Perpetuated?

• Selecting new employees who will fit in
• Systematic indoctrination of new employees
• Senior management efforts to reinforce core
  values, beliefs, principles, key operating
  practices
• Story-telling of company legends
• Ceremonies honoring employeeswho display
  cultural ideals
• Visibly rewarding thosewho follow cultural norms

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Culture Ally or Obstacleto Strategy Execution?

• A companys culture can contribute to or hinder
  organizational success
• A culture that promotes attitudes and behaviors
  that are well-suited to first-rate strategy
  execution is a valuable ally in the strategy
  execution process
• A culture that embraces attitudes and behaviors
  which impede good strategy execution is a huge
  obstacle to be overcome

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Why Culture Matters Benefitsof a Tight
Culture-Strategy Fit

• A culture that encourages actions and behaviors
  supportive of the organization
• Provides employees with clear guidance regarding
  what behaviors and results constitute good job
  performance
• Creates significant peer pressure among coworkers
  to conform to culturally acceptable norms
• A culture imbedded with values and behaviors that
  promotes strong employee commitment to the
  companys
• Vision
• Performance Goals
• Strategy

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Characteristics ofStrong Culture Companies

• Conduct business according to a clear,
  widely-understood philosophy
• Considerable time spent by management
  communicating and reinforcing values
• Values are widely shared and deeply rooted
• Have a well-defined corporate character,reinforce
  d by a creed or values statement
• Careful screening/selection of newemployees to
  be sure they will fit in

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Diversity Comes in Many Forms...

• There is a difference between the term
• Diversity and Culture
• Race
• Gender
• Age
• Socio-economic status (SES)
• Education
• Religion
• Political persuasion
• Cant afford to focus on just 1 or 2

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Cultural Diversity is Just Not a Global Issue
Gender as an Example Some things we do know...

• Sex differences in verbal skills (w gt m) seem to
  be declining or gone
• Differences in math skills (m gt w) seem to be
  declining or gone
• Men are more aggressive
• Men are less conforming
• When its about social approval
• More conforming for task completion
• Women and men communicate differently
• Venting/sharing vs. problem solving (Deborah
  Tanner You Just Dont Understand)
• Communication/linguistic styles (I v. We,
  Apology, Seek assistance, Blunt v. Tactful,
  Ability to praise, Present Confidence)

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Cross-Country Differences

• Culture, lifestyles and market demographics
  differ among countries
• Variations in manufacturing and distribution
  costs
• Fluctuating exchange rates Competitiveness of a
  companys operations partly depends on whether
  exchange rate changes affect costs favorably or
  unfavorably
• Differences in host government, economic and
  political (stability is more important than
  philosophy/ideology) demands

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Business Ethics in the Global Community

• Notions of right and wrong, fair and unfair,
  moral and immoral, ethical and unethical
• exist in all societies
• Two schools of thought
• Ethical universalism
• Holds that human nature is the same everywhere
  and ethical rules are cross-cultural
• Ethical relativism
• Holds that different societal cultures
  andcustoms give rise to divergent values
  andethical principles of right and wrong

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Cross-Culture Variabilityin Ethical Standards

• Apart from certain universal basics
• Honesty
• Trustworthiness
• Fairness
• Avoiding unnecessary harm
• Respecting the environment variations
• exist in what societies generally agree
• to be right and wrong in the conduct of
• business activities
• Factors affecting cross-cultural variability
• Religious beliefs
• Historic traditions
• Social customs
• Prevailing political and economic doctrines
• Cross-country variations also exist in the degree
  to which certain behaviors are considered
  unethical

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Cultural Dimensions in the Hofstede-Bond Research

• Power Distance Expectations of social
  inequality, status differences.
• Individualism-Collectivism focus on individual
  vs. group (how tight are the social bonds?)
• Masculinity-Femininity Expression of competitive
  or nurturing traits. Material goods vs. social
  good.
• Uncertainty Avoidance Preference for structured
  or unstructured situations. Risk preference.
• Long-Term Versus Short-Term Orientation
  (Confucian values) Save for the future and be
  persistent or live for today. Historical and
  future perspective.

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• Examples of Cultural Dimensions
• Power Individ- Quality Uncertainty
  Long-term
• Country Distance ualism of Life
  Avoidance Orientation
• China High Low Moderate Moderate High
• France High High Moderate High Low
• Germany Low High High Moderate
  Moderate
• Hong Kong High Low High Low High
• Indonesia High Low Mod Low Low
• Japan Mod Low High High
  Moderate
• Netherlands Low High Low Moderate
  Moderate
• Russia High Mod Low High Low
• United States Low High High Low
  Low
• West Africa High Low Moderate
  Moderate Low
• A low score is synonymous with
  collectivism.
• A low score is synonymous with high quality
  of life.
• A low score is synonymous with a short-term
  orientation.

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What is Organization Structure?

• Take everything thats characteristic of the
  people in a business Leadership, motivation,
  brains, satisfaction, stress, ...
• Throw it out.
• Whats left? The jobs, the technology, the
  machines, communication channels, etc.
• Thats the STRUCTURE, a.k.a. the Organizational
  ARCHITECTURE

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Structural Responses

• Why does it matter?
• Sooner or later, something fundamental in your
  business world will change. (Andrew S. Groves,
  Only the Paranoid Survive, 1996, Currency
  Doubleday.
• The PC, wireless tech, 9-11, Enron (Andersen),
  ...
• The 10X Change What such a transition does to a
  business is profound, and how the business
  manages this transition determines its future.

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Structural Dimensions of Organizations

• Formalization written rules and regulations
• Specialization perform only a small piece of job
• Standardization same job, same way
• Centralization power in one place
• Span of control number of subs per supervisor
• Professionalism identify with higher authority
• Communication (direction, type)
  horizontal/vertical, oral/written

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So, whats the best structure?

• It depends
• On what?
• The contingencies!
• These are strategic choices/factors
• Technologies (unpredictability) internal
• Environment/markets (unpredictability), both
  existing and potential
• Making products or services?
• Size
• Human Capital

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Contingencies Mechanistic vs. Organic Structures

• Two Key Issues affect a firms Environmental
  Uncertainty
• Complexity
• Resource Scarcity
• These are strategic choices/factors
• Technologies (more unpredictability), more
  organic structure
• Environment/markets (more unpredictability) more
  organic
• Services more organic (products, more
  mechanistic)
• Size (smaller) more organic
• Human Capital Demands (Increased Knowledge)
  more organic

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Organizational Design

• Growth is an Evolutionary Process
• Forms of Organizational Structure
• Centralized
• Product/Service
• Customer
• Geographic
• Matrix
• Networked
• Chaotic

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Audit the Dimensions Where are we now?Where
should we be?
Organic Mechanistic

• Formalization low high
• Specialization low high
• Standardization low high
• Centralization low high
• Span of control narr. wide
• Professionalism high low
• Communication type oral writ.
• Communication dir. hori. vert.

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Do a Gap Analysis (direction for transition)
Organic Mechanistic

• Formalization low high
• Specialization low high
• Standardization low high
• Centralization low high
• Span of control narr. wide
• Professionalism high low
• Communication type oral writ.
• Communication dir. hori. vert.

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Crafting your structure
High


Environment Information Complexity
X


Low
High
Low
Environment Resource Scarcity